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Our NewsletterIssue No. 36: The Right Way and the Wrong Way to End Disparity Between U.S and European Drug Prices
In his State of the Union Address in January, President Trump said it was “very, very unfair” that people who live in other rich countries pay less for medicines than Americans do. As we noted in Issue No. 29 of this newsletter, there are two ways to address the disparity…. Option 1: We can try to convince the Europeans, through pressure and persuasion, to adopt our own market-based approach to set prices, which has produced a wealth of innovative, life-saving drugs and given nearly all Americans access to them. Option 2: We can adopt the approach of the Europeans themselves, whose nationalized health-care systems use monopsony power – combined with cost-containment mechanisms such as health technology assessments, forced localization as a condition of market access, and various types of reference pricing – to constrain prices. The result has been to throttle drug development and limit timely access for patients. Unfortunately, it appears the Administration is considering the second option for the Medicare program. READ MORE HERE. |
What Others Are Saying"The anger directed at the pharmaceutical and biotech industries overall is misdirected. The single biggest driving force for increased health-care spending in the U.S. is the rising cost of labor, not drugs." "Even if pharmaceutical spending were rising as a share of total health care spending, but that rise was due to pharmaceutical investments driving down expenditures in other health care areas (e.g. a reduced need for more expensive surgeries), then it would still be inaccurate to argue that pharmaceutical spending is driving overall health care inflation." |
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